TD Cowen: Cryptocurrency Market Structure Bill May Be Delayed, Enacting Only in 2029

TD Cowen warns that the U.S. Cryptocurrency Market Structure Bill may be delayed until 2027 for passage and implemented in 2029. The main obstacle is the Democratic Party’s demand for conflict-of-interest restrictions on high-ranking officials like Trump, while the Trump family has profited $620 million from crypto projects. The Senate requires 60 votes to pass, and policy experts believe the chances of passing in 2026 are only 50-60%.

Trump’s $620 Million Interests Become the Biggest Obstacle

Jaret Seiberg, Managing Director of TD Cowen and head of the Washington research team, pointed out in a report on Monday that although there is still a possibility the crypto market structure bill could be passed this year, the political dynamics in Congress make a delay more likely. The key issue is expected to be the conflict-of-interest provisions, with Democrats likely pushing to prohibit senior government officials and their families (including President Donald Trump) from owning or operating crypto businesses.

Bloomberg estimated last July that Trump profited about $620 million through crypto projects related to his family, including World Liberty Financial, a DeFi and stablecoin project co-founded by Trump and his three sons. The family also holds shares in Bitcoin mining company American Bitcoin. Meanwhile, lawmakers have expressed concern over the meme coins “TRUMP” and “MELANIA” launched shortly before Trump took office.

Seiberg stated that unless the effective date is postponed by several years, Trump would definitely not accept such conflict-of-interest provisions. He suggested that one potential way to overcome Trump’s opposition is to delay the effective date of the conflict-of-interest provisions until three years after the bill’s passage. This would mean the provisions would come into effect after the next presidential inauguration, effectively making them never applicable to Trump.

However, Democrats are unlikely to accept such a unilateral compromise. Seiberg believes they will not agree unless they also agree to delay the implementation of other parts of the Crypto Market Structure Bill by three years. This deadlock effectively paves the way for the bill to be delayed until 2027 for passage and implemented in 2029.

Democratic Political Calculations and Time Leverage

The group states that Democrats may lack the motivation to push the bill quickly, especially if they believe they can regain control of the House in the 2026 midterm elections. Seiberg wrote, “Election outcomes are always uncertain, so Democrats might reach an agreement. This could happen quickly, as staff have been researching technical provisions for months.”

However, Seiberg leans toward another scenario: “Time favors the passage of the bill. If it is passed in 2027 and takes effect in 2029, the issue will disappear. The crypto industry needs to accept that the presidential election could influence final rules, and Democrats need to accept that conflict-of-interest provisions do not apply to Trump.”

This dynamic gives Democrats leverage to delay the bill’s passage until after the midterm elections. A later effective date could also push implementation past the next presidential inauguration, allowing Democratic regulators to formulate final rules after Democrats win the White House. Seiberg noted that complex legislation usually takes years to become effective, citing the three-year implementation cycle of the GENIUS Act as an example.

Breaking the Senate’s filibuster rules requires 60 votes, meaning even if all Republicans support the bill, at least 7 Democrats are needed. Seiberg added that in reality, 8 to 9 Democrats might be necessary, as some Republicans are expected to oppose the legislation. This voting structure gives Democrats key leverage in negotiations.

Three Chain Reactions of the Delayed Crypto Market Structure Bill

Regulatory Uncertainty Continues: Industry operates without clear rules, leading to high costs for innovation and compliance, potentially driving companies overseas.

Loss of Competitive Edge: EU’s MiCA regulation has taken effect, China is promoting digital yuan, and the delay in the U.S. will result in losing influence over global digital asset regulation.

Trump’s 2028 Re-election Variable: If the bill is delayed until 2029, conflicts of interest involving Trump’s family could again become a focal point in the 2028 election.

Industry and Government Interests Diverge

This has led to friction between the crypto industry and the government, with the industry hoping the law will take effect during Trump’s presidency and maintaining a neutral stance on conflict-of-interest provisions. Seiberg said this disagreement is at the core of the slow political progress of the Crypto Market Structure Bill. The legislation is widely seen as a key regulatory milestone following the passage of the Stablecoin GENIUS Act, establishing a clear framework for U.S. digital asset regulation, including institutional oversight and asset classification.

The House passed its version of the Market Structure Bill last year, but progress in the Senate has slowed, with committees expected to review the issue later this year. Policy experts recently told The Block that they believe the likelihood of the Crypto Market Structure Bill becoming law in 2026 is 50-60%. This relatively conservative forecast aligns with TD Cowen’s analysis, indicating industry skepticism about passing the bill in the short term.

From an industry perspective, a four-year delay means a longer period of regulatory vacuum. Companies will face ongoing uncertainty in product design, compliance frameworks, and market expansion. More seriously, this could push more crypto firms to relocate their headquarters to jurisdictions with clearer regulation, such as the EU, Singapore, or the UAE.

Overall, the likelihood of the Crypto Market Structure Bill being delayed until 2027 for passage and implemented in 2029 is increasing. The $620 million crypto interests of the Trump family and the Democratic conflict-of-interest demands have created a deadlock, and the Senate’s 60-vote threshold forces compromise. The industry’s wait for regulatory clarity could be extended by another 4 years.